Senate bill seeks to amend Medicare hospital stay rule

A U.S. senator is pushing his colleagues to change a law that can leave retirees and others on Medicare on the hook for huge hospital bills.

Under the rule, Medicare won’t pay for skilled nursing care after a hospital stay that lasts less than three days. Time spent in the hospital for observation before admission is not counted.

Sen. Sherrod Brown, D-Ohio, wants to make observation time count toward the three days. His bill would also allow those who were hit by hospital charges after Jan. 1, 2013, to appeal within 90 days of the law’s passage.

Brown’s bid to change the law failed in 2013. Last June, the American Medical Association wrote a letter to the senator supporting the change. The association asserted hospitals, driven by auditors and Medicare contractors, were misclassifying the hospital stays of many patients.

“We have advocated that hospitals should instead submit claims based on the medical judgment of the admitting physician, and that patients should not have to bear the significant costs associated with these current classification practices,” the letter said.

The current rule is intended to draw a line between inpatient and outpatient services, according to the Centers for Medicare and Medicaid Services. Inpatient status is not started until a doctor orders admission to a hospital.

Of the approximately 42 million Americans age 65 or older enrolled in Medicare, about 39 million are drawing Social Security.

In addition to the AMA, Brown’s bill has the backing of AARP and the American Health Care Association, among other groups.

The parent company of United Airlines and Continental Airlines said Wednesday that Continental has reached a labor agreement with representatives of some 7,200 non-union employees who work as reservation agents and in other passenger-service roles.